Reference no: EM131638145

Problem - Lanahan Corporation is in the process of setting a selling price for a new product it has just designed. The following data relates to this product for a budgeted volume of 10,000 units.

Expense Category Per Unit Total Amount

Direct Materials $30

Direct Labor   $25

Variable Manufacturing Overhead $15

Fixed Manufacturing Overhead $200,000

Variable Selling & Admin Expenses $10

Fixed Selling & Admin Expenses $110,000

Lanahan uses cost-plus pricing to set its target selling price. The markup on total unit cost is 25%.

Calculate each of the following for the new product:

Total variable cost per unit:

Total fixed cost per unit:

Total cost per unit:

Desired ROI per unit:

Target selling price per unit: